US stocks end moderately higher

Upbeat data from Wall Street help stocks move up

U.S. stocks finished moderately higher on Thursday, 20 November 2014. The incremental gains on the S&P 500 and the Dow Jones Industrial Average, which came amidst thin trading volumes, were enough to send the indexes deeper into record territory. Ahead of the opening bell, stock futures were under pressure after a batch of economic indicators from Europe and China showed weakness. However, markets were able to shake off those concerns following some upbeat data as well as better-than-expected earnings from retailers.

The Dow Jones Industrial Average added 33.27 points, or 0.2%, to 17,719.00, logging its 27th record close in 2014. The Nasdaq Composite ended the day up 26.16 points, or 0.6%, at 4,701.87. The S&P 500 closed 4 points, or 0.2%, higher at 2,052.75, the 44th record close this year.

Diving deeper into Thursday's trading action reveals, small companies outperformed the large, while gains in energy and technology sectors outweighed losses in healthcare and consumer staples.

Among Tuesday's positive economic releases was a rise in existing home sales, a jump in the Philly Fed index and weekly jobless claims remaining below 300,000 for the 10th straight week. Consumer prices were flat in October, while U.S. November Markit flash PMI was the weakest since January, declining for a third straight month.

Chinese factory activity fell to its lowest level in six months in November, with the preliminary HSBC China Manufacturing PMI falling to 50.0, compared with a final reading of 50.4 in October.

In overnight news, the HSBC China manufacturing purchasing managers index (PMI) came in at 50.0 in November, which is down from 50.4 in October. A PMI reading above 50.0 suggests growth in the sector. That's just another underlying bearish factor for the beaten-down raw commodity sector. China is the world's largest importer of raw commodities.

Meantime, the Markit data firm on Thursday reported the European Union's composite PMI fell to 51.4 in November from 52.1 in October, which is a 16-month low. The survey also showed manufacturers in the EU are not optimistic about future growth. This news helped to pressure European stock markets. It's also another reason for the European Central Bank to embark on more monetary policy stimulus measures.

The Japanese yen fell to a seven-year low against the U.S. dollar Thursday, as the Bank of Japan's effort to devalue the yen is working.

U.S. economic data were mostly neutral with inflation over the past 12 months unchanged at 1.7% in October while initial jobless claims dropped by 2,000 to a seasonally adjusted 291,000 in the week ended 15 November 2014, as per the Labor Department. Continuing claims fell to 2.330 million from an upwardly revised 2.403 million, representing the lowest level since December 2012.

The CPI report was unchanged in October (consensus -0.1%) while Core CPI ticked up 0.2% (consensus 0.1%). The increase in core prices in October was the largest gain since prices rose 0.3% in May, but year-over-year price growth remains benign at 1.8%

Existing home sales increased to 5.26 million SAAR in October from an upwardly revised 5.18 million (from 5.17 million) while the consensus pegged sales at 5.17 million. Sales increased 2.6% year-over-year, which was the first gain on that basis since last October. It was also the most homes sold since September 2013.

The Philadelphia Fed's Business Outlook spiked to 40.8 in November from 20.7 while the consensus expected a decline to 18.3. Business activities in the Philadelphia region reached their highest point since December 1993. A total of 49% of firms saw business activities improve in November as opposed to only 9% that saw decreased activity

The Leading Indicators report for October was up 0.9%, while the consensus expected a reading of 0.6%. That followed a revised 0.7% increase in September (from 0.8%)

Among stocks under focus, Best Buy shares jumped 7% after earnings beat forecasts.

Bullion metal prices ended the U.S. day session slightly lower on Thursday, 20 November 2014. A rallying U.S. stock market that continues to funnel money away from other assets such as precious metals remains a bearish underlying factor. Gold prices extended losses for a second session continuing to feel pressure from news that a proposal which could require the Swiss central bank to ramp up its holdings in bullion is losing support.

Gold for December delivery fell $3 to settle at $1,190.90 an ounce, reducing an earlier loss that saw it down as much as $16. December silver was off 16 cents to $16.14 an ounce. March Comex silver last traded down $0.15 at $16.20 an ounce.

Crude-oil futures rose on Thursday, 20 November 2014 snapping a string of losses as investors awaited for the upcoming OPEC meeting just a week away for a firmer direction on supplies and thus on prices.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in December rose $1, or 1.3%, to settle at $75.58 a barrel. Futures on Wednesday had closed lower for a third straight session.

Treasuries spent the day in the green, but ended near the bottom of the intraday range, sending the 10-yr yield lower by three basis points to 2.33%.

Participation was on the light side with fewer than 650 million shares changing hands at the NYSE.

There is no economic data of note on tomorrow's schedule.

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